NORTH AMERICA ERICSSON MOBILITY REPORT 2016 - Cision
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NORTH AMERICA ERICSSON MOBILITY REPORT JUNE 2016
Market Overview
Key figures: US and Canada
2015 2021 CAGR 2015–2021
Mobile subscriptions (million) 390 450 2%
Smartphone subscriptions (million) 280 370 5%
Data traffic per active smartphone (GB/month) 3.8 22 35%
Total mobile traffic (EB/month) 1.3 8.5 35%
The macro-economic environment mobile data is important, as consumers rely on mobile devices
for a variety of popular high bandwidth services, such as short
The US and Canada are economically developed countries, video viewing, social media and internet browsing.2
with high per capita GDPs. This has enabled high information
and communication technology (ICT) adoption. Over Mobile internet
70 percent of the region’s cellular subscriptions in 2015 were
for smartphones, compared to less than 50 percent globally. Almost 80 percent of US and Canadian internet users use
smartphones to go online weekly.2 While about 95 percent
Combined US and Canada GDP increased 2.3 percent during of US and Canadian internet users use the internet daily
2015. Lower growth is projected for both in 2016, with US at home, less than 30 percent of them use the internet
GDP growth projected to be 2.0 percent and 1.7 percent in daily during commuting/traveling. Around 70 percent of the
Canada.1 Although consumer spending remains strong in region’s mobile internet respondents are satisfied with the
both countries, business investments remain stagnant. In home internet experience for instant messaging/emailing
the US, there is general concern about shrinking margins, and web browsing/social media. That percentage decreases
translating to less willingness to invest capital, other than for when users become mobile. For example, about 60 percent
repair or replacement. of respondents say they are satisfied while at school or
work, and around 55 percent are satisfied with mobile
The region’s total mobile data usage will grow by 35 percent internet while commuting. Therefore, there is still some room
annually through to 2021, requiring operators to focus their for improvement in the user experience for internet services
expenditures on expanding mobile broadband to increase its away from the home or office.
coverage, speed and capacity. The quality and throughput of
Frequency of internet usage across locations, Mobile internet satisfaction, US and Canada (percent)
US and Canada (percent)
Video calls Web browsing/social media
100 Daily Monthly
Streaming video Instant messaging/emailing
Weekly Less often
80 80
60 60
40 40
20 20
0 0
At home At school/ Commute/ All other At home At school/ Commute/ Subway/
work travel places work travel metro
Source: Ericsson ConsumerLab, Analytical Platform (2015), USA and Canada Source: Ericsson ConsumerLab, Analytical Platform (2015), USA and Canada
Base: Internet users, aged 15–69 years Base: Mobile internet users and respective activity users, aged 15–69 years
1
The Economist Intelligence Unit (2016)
2
Ericsson ConsumerLab, Analytical Platform (2015), USA and Canada
2 ERICSSON MOBILITY REPORT NORTH AMERICA JUNE 2016Mobile subscriptions
The US and Canada represent around 5 percent of global mobile
subscriptions. The region had 395 million subscriptions in Q1 2016 – a
penetration rate of 109 percent. Between 2015 and 2021, it is forecast
that mobile subscriptions in the US and Canada will grow at a compound
annual growth rate (CAGR) of 2 percent, to 450 million subscriptions
Technology evolution Smartphone subscriptions
The majority of US and Canadian mobile subscriptions, at Smartphone subscriptions are ubiquitous in the US
around 55 percent, are LTE subscriptions. This is due to and Canada, making up over 70 percent of total mobile
the region’s maturity level and the broad coverage of LTE subscriptions. It is estimated that by 2021, nearly all
in both countries. By 2021, LTE and 5G technology will handsets will be smartphones, as subscriptions reach
completely dominate US and Canadian subscriptions, while 95 percent of handsets. This high level of smartphone
other technologies, such as WCDMA/HSPA and CDMA adoption drives the need for data.
continue to decline, ending up with less than 5 percent
of all subscriptions.
Mobile subscriptions by device,
By 2021 in North America, 95 percent US and Canada (million)
of all mobile subscriptions will be for LTE/5G Smartphones Mobile PCs, tablets and mobile routers
Basic phones
Mobile subscriptions by technology, 500
US and Canada (million)
LTE/5G WCDMA/HSPA GSM/EDGE-only
CDMA-only Other 400
500
300
400
300
200
200
100
100
0
0 2015 2016 2017 2018 2019 2020 2021
2015 2016 2017 2018 2019 2020 2021
NORTH AMERICA JUNE 2016 ERICSSON MOBILITY REPORT 3Data Plans
and Usage
The two major data plan options in the US are limited bundled
data and unlimited data. Many unlimited data subscribers have
older, grandfathered plans, although some service providers
have introduced new versions of unlimited plans
The US mobile market is embroiled in a data price There is currently an almost even split between shared
competition, and unlimited plans have made a comeback, and individual plans, with just over 50 percent of plans
although these offerings usually have a time limit or require being shared. Around 50 percent of those are shared
subscription to additional services. US operators have with family, with a smaller number sharing between their
approached the price competition in different ways, but own devices. A significant number of individuals - around
each of the major operators has reduced their data pricing 30 percent - share their plans with four or more devices.
in some way, or included more data in existing price plans.
Currently in the US, over half of subscriptions are connected
to a data plan, with over 30 percent connected to a limited
data plan and almost 25 percent connected to an unlimited
plan. Monthly allowances run high; over 70 percent of
mobile subscriptions on limited data plans have a 1 GB
or higher monthly allowance per phone, and almost 15 Over 70 percent of US mobile subscriptions
percent have more than 10 GBs of data allowance. on limited data plans have a monthly allowance
per phone of 1 GB or higher
Types of mobile phone data plans, US
Limited data plans
31%
I pay per service/usage Number of mobile phones in
Unlimited data plan shared data plans, US
13%
Other/don’t know Two Three Four
23%
Five More than five
33%
5%
Source: Ericsson ConsumerLab, Analytical Platform (2015), USA 6%
Base: Mobile/smartphone users and mobile internet users, aged 15–69 years
Monthly mobile phone data allowances, US
19%
42%
4%
< 100MB
13%
100MB–999MB
23%
12% 1GB–4.9GB
5GB–9.9GB 28%
9% ≥ 10GB
Don’t know
39%
Source: Ericsson ConsumerLab, Analytical Platform (2015), USA
Base: Mobile/smartphone users and mobile internet users
who have shared data plans, aged 15–69 years
Source: Ericsson ConsumerLab, Analytical Platform (2015), USA
Base: Smartphone users on limited data plans, aged 15–69 years
4 ERICSSON MOBILITY REPORT NORTH AMERICA JUNE 2016Mobile traffic
Mobile data traffic growth shows no signs of slowing down.
It is forecast to grow by around 50 percent in 2016. With
data being such an essential part of cellular service, a
good data connection is critical to customer satisfaction
Downlink data throughput measurements in Canada and
the US can indicate whether highly download-dependent
apps, with different performance requirements, will
work well all the way to the cell edge. As a point of In 2021, mobile data traffic per active
reference, a downlink throughput rate of at least smartphone in North America will be the
1.5 Mbps is recommended for collaboration services, highest in the world at 22 GB per month
while 2.5 Mbps is recommended for HD video viewing.
Analysis of network measurements on LTE networks
showed significant opportunities for improvement in
Data traffic per active smartphone, US
cell-edge performance in the US, where LTE demonstrated and Canada (monthly GigaBytes)
speeds that were not fast enough to secure the
expected continuous performance of collaboration 25
services or HD video viewing. However, in Canada,
LTE speeds were able to support both services. 20
Although LTE network cell-edge performance appears
to be declining in both markets, this is a normal 15
phenomenon. In all developed markets, newly deployed
LTE networks exhibit very high speeds before they begin 10
to be loaded with traffic. As more LTE subscriptions and
handsets are deployed, the downlink throughput declines,
then stabilizes, and begins to slowly increase as the 5
networks are built out. The cell-edge network speeds
pooled from all cellular technologies indicate that the 0
performance is generally improving on these networks. 2015 2016 2017 2018 2019 2020 2021
Cell-edge throughput, US and Canada (Mbps)
All cellular US LTE-US
All cellular Canada LTE-Canada
10
9
8
7
6
5
4
3
2
1
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2012 2013 2014 2015
Source: Ericsson analysis on Speedtest Intelligence data from Ookla (2012–2015)
Note: 90 percent of the measurements are at the plotted speed or higher,
which gives a good proxy for cell-edge performance
NORTH AMERICA JUNE 2016 ERICSSON MOBILITY REPORT 5MOBILE PHONES –
ACTIVITY AND APPs
Subscribers use their mobile devices for a myriad of activities
on a regular basis. Video continues to increase in popularity,
with 40 percent of mobile/smartphone users in the region
stating they watch full length movies at least weekly
Other popular daily activities include making and However, even for those apps, about 30 percent of US
receiving calls, emailing, internet browsing and using and Canadian users stated their usage had increased.3
social media. Bandwidth-intensive activities rank
lower in terms of amount of time spent, but are still
highly significant. For example, almost 70 percent of
US and Canadian mobile/smartphone users say they
watch short video clips at least on a weekly basis, and
almost 50 percent stream full length movies at least weekly.
Mobile app usage has increased dramatically compared Almost 50 percent of US and Canadian
to last year. Social media apps have the highest increase, mobile/smartphone users say they watch
with almost 50 percent of smartphone/tablet users saying
full length movies at least weekly
they have increased their use of social networking in the
past year. The smallest increase was for community apps.
Mobile services usage frequency, US and Canada (percent)
Daily Weekly Monthly Less often
Send or receive text messages 73 21 2 5
Make or receive calls 62 28 3 8
E-mails 62 23 3 12
Browse the internet 57 29 4 10
Use social networks 51 26 3 21
Send/receive photos 37 37 9 17
Play mobile games 37 28 5 31
Watch short video clips online 35 35 5 25
Use instant messaging service 35 26 6 34
Stream music online 27 28 6 39
Watch full length movies/TV 25 23 5 46
Use maps/navigation 23 39 13 24
Use business apps 23 19 5 53
Use mobile payments 21 24 11 44
Video calls 22 23 8 47
Online shopping 18 26 16 40
Visit dating sites/apps 19 13 2 66
Source: Ericsson ConsumerLab, Analytical Platform (2015), USA and Canada
Base: Mobile/smartphone users and mobile internet users, aged 15–69 years
3
Ericsson ConsumerLab, Analytical Platform (2015), USA and Canada
6 ERICSSON MOBILITY REPORT NORTH AMERICA JUNE 2016THE INTERNET OF
THINGS AND 5G
The Internet of Things (IoT) is taking shape in the US and Canada, with both
consumer and industrial use cases. Many consumer applications are items people
use every day, such as activity trackers, smartwatches and connected thermostats.
There will be around 3 billion IoT connected devices in North America in 2021
Commercial IoT applications, such as connected vehicles Lower energy use will allow sensors to be deployed in remote
and smart meters, are also being introduced in the region. and inaccessible places where a battery life measured in
For example, US cities like Los Angeles, and Canadian cities years will be a critical requirement.
like Halifax, are deploying connected street lighting to cut
down on waste and make streets safer for drivers. With these clear advantages, several service providers in the
region are beginning 5G trials in 2016, with 95 percent of
The connected vehicle IoT application continues to gain US and Canadian service providers expecting trials to have
traction in the US and Canada. The major operators in begun by 2018.5 The trials will help guide 5G standards and
these countries have established relationships with auto set the stage for widespread commercial availability.
manufacturers, and nearly every major auto manufacturer
is represented. The primary service offered by auto
manufacturers is emergency assist services, followed by
vehicle diagnostics. The majority of operators are using LTE
to provide services to connected cars, although a few still
rely on 3G or other systems. A US operator reported having
added more than 1 million connected vehicles in the fourth
There will be around 3 billion
quarter of 2015 alone.
IoT connected devices in
North America in 2021
95 percent of service providers in the US and
Canada are saying they expect to be in 5G
trials by 2018
Service providers in the US and Canada have begun to move
towards 5G, which will not only support more traffic, but
also faster speeds, lower latency and lower energy use. 5G
still has many challenges, including spectrum issues, but
it also promises significant opportunities for operators. In
fact, 5G will provide speeds 10–100 times faster than 4G,
allowing consumers to download full-length HD movies in
seconds. These speeds are so fast that some operators in the
region are looking at using 5G to either augment or replace
traditional copper and fiber broadband “last mile” solutions.
The lower latency of 5G means a connected car could
report an accident before the airbags were fully inflated,
and 70 percent of US and Canadian public safety
organizations surveyed believe faster arrival at incidents
is a key use case for 5G.4
4
Ericsson 5G Industry Survey (2016)
5
Ericsson 5G Operator Survey (2015)
NORTH AMERICA JUNE 2016 ERICSSON MOBILITY REPORT 7Ericsson is the driving force behind the Networked Society – a world leader in communications technology and services. Our long-term relationships with every major telecom operator in the world allow people, business and society to fulfill their potential and create a more sustainable future. Our services, software and infrastructure – especially in mobility, broadband and the cloud – are enabling the telecom industry and other sectors to do better business, increase efficiency, improve the user experience and capture new opportunities. With approximately 115,000 professionals and customers in 180 countries, we combine global scale with technology and services leadership. We support networks that connect more than 2.5 billion subscribers. Forty percent of the world’s mobile traffic is carried over Ericsson networks. And our investments in research and development ensure that our solutions – and our customers – stay in front. Ericsson SE-164 80 Stockholm, Sweden Telephone +46 10 719 0000 EAB-16:008198 Uen Rev B www.ericsson.com © Ericsson AB 2016
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